UK retail sales recovered in October after two months of declines. Photograph: Lewis Whyld/PA

British retail sales recovered last month after two months of declines.

Analysts said the looming VAT increase in January was prompting consumers to bring some purchases forward, but warned that the recovery would not last into the new year.

Sales volumes increased by 0.5% in October, the first monthly rise since July, the Office for National Statistics said this morning. Analysts had expected a 0.4% gain. However, September's fall was revised lower to 0.5% from 0.2%.

"Our sense is that retail sales and consumer spending more generally will remain firm into the fourth quarter as people bring forward their spending ahead of the VAT rate hike in January," said Amit Kara at UBS. "The first quarter, however, will be weak and going forward next year we expect anaemic consumer spending growth."

Clothes and shoe shops saw sales rise by 0.6% last month while "other shops" – which include bookshops, carpet and sports goods retailers, art dealers, jewellers and pharmacies – enjoyed a 1.6% increase. Supermarkets and other food stores posted a 0.1% rise. There was some discounting at clothes chains in October, where prices fell overall, as some retailers had clearouts ahead of Christmas, the ONS reported earlier this week.

The largest fall was in department stores where sales dropped 0.8%, followed by household goods stores with a 0.6% decline.

Retail sales in the three months to October were 0.1% higher than in the previous three months.

Alan Clarke, UK economist at BNP Paribas, said: "In real terms, consumer income is falling, making it hard for consumer spending growth to accelerate. Sadly, we don't see this situation changing any time soon."

After allowing for tax rises and inflation, take-home pay is currently falling at rate of 3% a year, estimates Chris Williamson, chief economist at Markit.